Provides that any person who provides information to the attorney general, a district attorney or the insurance frauds bureau concerning a fraudulent insurance transaction or with information about a fraudulent insurance transaction that is about to take place may be entitled to an award of forty percent of the action or claim relating to such fraudulent action.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A4495
SPONSOR: Pretlow TITLE OF BILL:
An act to amend the insurance law, in relation to compensation for
reports of insurance fraud to law enforcement authorities
PURPOSE OF BILL:
Section 405-a of the insurance law is amended to read that to be enti-
tled to receive an award of forty percent of the proceeds of the action.
JUSTIFICATION:
Insurance fraud is a serious crime facing New York State. Due in part to
a large amount of insurance fraud, New York State suffers from some of
the highest insurance rates in the nation. This law will help combat
this existing problem. Enforcement of laws can only be carried out to
the fullest if there is community cooperation. This law would help
encourage it.
LEGISLATIVE HISTORY:
2021-2022 A1519 referred to insurance
2019-2020 A3072 referred to insurance
2017-2018 A2551 referred to insurance
2015-2016 A2259 referred to insurance
2013-14 A3503 referred to insurance
2009/2010 A2753 referred to insurance
FISCAL IMPLICATIONS:
NONE
LOCAL FISCAL IMPLICATIONS:
NONE
EFFECTIVE DATE:
This act shall take effect immediately and shall apply to all reports of
fraudulent insurance transactions made on and after such effective date.
STATE OF NEW YORK
________________________________________________________________________
4495
2023-2024 Regular Sessions
IN ASSEMBLY
February 16, 2023
___________
Introduced by M. of A. PRETLOW -- read once and referred to the Commit-
tee on Insurance
AN ACT to amend the insurance law, in relation to compensation for
reports of insurance fraud to law enforcement authorities
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The insurance law is amended by adding a new section 405-a
2 to read as follows:
3 § 405-a. Compensation for report of insurance fraud to law enforce-
4 ment authorities. (a) Any person, other than persons described in
5 subsection (a) of section four hundred five of this article, who has
6 reason to believe that a fraudulent insurance act prohibited pursuant to
7 article one hundred seventy-six of the penal law has been committed or
8 that an insurance transaction may be fraudulent, or has knowledge that a
9 fraudulent insurance transaction is about to take place, or has taken
10 place may report such act or transaction and any additional information
11 relative to the factual circumstances of the transaction and the parties
12 involved to the attorney general, district attorney or insurance frauds
13 bureau.
14 (b) If the insurance frauds bureau recommends to the attorney general
15 or district attorney to commence an action or if the attorney general or
16 district attorney commences an action based on information provided by a
17 person pursuant to subsection (a) of this section, then such person
18 shall be entitled to receive an award of forty percent of the proceeds
19 of the action. The attorney general or district attorney shall recom-
20 mend to the court when a settlement is entered the amount of such award.
21 The court shall base such award decision on the extent to which the
22 person substantially contributed to the prosecution of the action.
23 § 2. This act shall take effect immediately and shall apply to all
24 reports of fraudulent insurance transactions made on and after such
25 effective date.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09504-01-3
